The National Pension Commission (PenCom) has proposed a new gratuity framework of N30 billion yearly for federal civil servants under the Contributory Pension Scheme (CPS).

This is part of ongoing reforms to improve retirement benefits for workers in treasury-funded ministries, departments and agencies (MDAs). The commission’s Director-General, Omolola Oloworaran, said this during a courtesy visit to the Head of the Civil Service of the Federation (HCSF), Didi Esther Walson-Jack, in Abuja.

The DG noted that the commission was seeking the formal endorsement of the HoS to establish the scheme in line with Section 4 (4)(a) of the Pension Reform Act (PRA) 2014.

According to her, the proposed scheme would allow retiring civil servants to receive 100 per cent of their final gross yearly pay as gratuity, with the yearly total cost estimated at a cost of N30 billion.

“This is a modest but impactful intervention that would significantly improve the welfare of those who have served the country with dedication,” she said.

The DG also raised concerns over the persistent delays in the payment of accrued pension rights entitlements of employees who were in service before the introduction of the CPS. She acknowledged that collaboration between PenCom and the Office of the HCSF in the past had led to the Federal Executive Council’s approval of N758 billion bonds to clear backlogs of pension liabilities.

To further address the lingering issue of accrued rights in the country, the commission announced a one-time comprehensive online verification and enrolment exercise for all serving federal employees in treasury-funded MDAs who joined service before June 2024.
Scheduled to begin in August 2025, the exercise will determine outstanding liabilities and help the commission present a final figure to the FG.

“Once determined, these accrued rights will be credited directly into the Retirement Savings Accounts (RSAs) of eligible civil servants, allowing them to begin earning investment returns on their funds,” the DG explained.She added that this would insulate the system from disruptions due to political transitions.

The commission also sought the support of the HCSF in directing the IPPIS office at the Office of the Accountant General of the Federation (OAGF) and MDAs outside IPPIS to adopt the new remittance method.

Walson-Jack expressed full support for PenCom’s initiatives, particularly the proposed gratuity scheme, which she said aligns with long-standing calls from civil servants.
She pledged to issue the necessary circulars and work closely with the commission to develop and secure approvals for the new framework.